Bearish candlesticks

Investors often using their emotions to trade stock markets. They are not calm but too much greedy or fearful. Trading stock market successfully means often to recognize current thinking of other investors.

Greed as positive emotion is not as strong as fear. This negative state of mind is often overwhelming investors and they are sometimes panicking and selling their stocks.

Negative emotions are shown on the chart. Bearish candlestick patterns chart price movement representing bearish attitudes.

These patterns can consist of one, two or more candlesticks.

I personally think that for short-term trading it’s important to know these two types of negative candlesticks patterns:

• long black body candlestick
• big upper shadow candlestick

Here are examples on stock charts:

This first chart presents that the price tried to go through resistance of a downtrend line and 50EMA, but every time dived again under them. This is a really strong signal that the stock is under selling pressure. Also, notice the high number of long upper shadow candles on this chart.

This chart shows how long red candlesticks developed every time the price touched a downtrend line.

My stock market trading tip

Use volume to confirm negative sentiment

When negative candlesticks are accompanied by larger then usual volume then it gives you additional confirmation of negative felling about situation. There is much higher probability of continuation of downtrend move in near future.

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